The Economist: a Case Study

The Economist: A Case Study for a Hybrid Ad Operations Model
Outsourcing your ad operations is not a new concept, but even companies that want to use it are still trying to figure it out so that it works for them. A hybrid model may work best.
“ZEDO has delivered much better quality of service as well as improved turnaround time in comparison with the previous vendor.”

The problem:

How to outsource your ad operations for optimum revenue. In a global market, slow processing of requests and faulty implementation (blank pages or broken pages served), cost The Economist an estimated $250,000 in revenue annually — an unacceptable situation.

The solution:

The Economist has always outsourced its ad operations. But after three unsuccessful tries at total outsourcing, the well-respected financial news and analysis site has finally settled on a hybrid model as the one they are most comfortable with. Before settling on that model, the magazine used  total outsourcing, but found that to be flawed because all transactions flowed up to a single manager in the outsourcing vendor. In a global operation, where transactions are done on a 24/7 basis in many time zones, if that manager was unavailable (let’s say asleep), the result as an expensive single point of failure.

In the case of The Economist,  slow processing of requests and faulty implementation (blank pages or broken pages served), cost them an estimated $250,000 in revenue annually — an unacceptable situation.

Thus, the magazine chose a hybrid model with ZEDO. This choice keeps the strategic work in house and outsources the tactical implementation with SLAs and reporting requirements to show effectiveness. The expectations were laid out in advance, the SLAs agreed on, and implementation has gone flawlessly. Since ZEDO, The Economist hasn’t lost any money and trafficking errors have been caught internally because of a proactive relationship and good communication.

Details of the model include traffickers in all important time zones. It includes a combination of in-house onshore and outsourced offshore resources. Of the 8 member global ad operations team, five are internal and three external

  • A Director of Ad Operations is based in London – The Economist
  • Two Ad Operations managers –  (one in NYC and one in London) The Economist
  • Two Onshore trafficker – 2 Nos. (one in NYC and one in London) The Economist
  • Three Offshore traffickers from ZEDO –  (work as per time zones in their respective markets – BST (UK and Continental Europe), EST (North America) and HK (for APAC) time.

Operations began in October of last year, and so far  the feedback from their Sales teams across all markets has been extremely positive. Their view:  “ZEDO has delivered much better quality of service as well as improved turnaround time in comparison with the previous vendor.”

Summary:

  • ZEDO’s accuracy percentage over a nine month period has been 99.3%. This is a significant improvement in comparison to the previous vendor. By our estimate, our improved accuracy is likely to have saved The Economist more than a quarter million dollars in revenue  compared to the previous year.
  • ZEDO has processed 100% of P1 requests (P1 are high priority requests) have within 3 hours through 2013.
  • Significant process improvements have been made in terms of delivery of screenshots and advanced performance / delivery reports
  • Quarterly review meetings have been held in order to seek constant feedback and process improvement opportunities.
  • The Economist and ZEDO work as partners and not in a typical client – vendor relationship.
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